Chartwhiz: Futures Technical Outlook: 9.15.10

Dec Gold: Gold prices soared to new record levels posting a high at 12765 on Tuesday before closing on a new record high settlement at 12717 gaining $24.60.  The move reversed the minor 4-day correction with a Bullish outlook and a buy dips bias against the current breakout levels which will now act as Support. 

Overnight action has mainly been consolidating in a tight range around settlement with little directional indication for the open.  If we open the pit session above 12717 Settlement, expect to see retesting of the highs at 12745-12775 X Resistance.  If we open below the 12700 level, wait to buy dips against listed Support ranges.  An upside break to new highs has a projected trend channel target at the 7-week and 35-day trends at 12860 XXX Resistance while making the 13000 level a reality in the foreseeable future.

On the sell side, sellers can lightly short scalp on an open below 12700-12717 X Resistance, or short a rejection at 12745-12775 XX Resistance for a potential double top turnover.  Use listed Support targets to cover short positions today and trail stops to protect gains.  A settlement below 12550 today will temporarily neutralize the Bull momentum.

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Oct Natural Gas: Natural gas prices finished higher on Tuesday for a third-straight session after volatile swings off of the 4000 level.  The market remains in a 5-day uptrend channel with a Bullish outlook in place for Wednesday’s session.  Still, be on guard for volatile swings if we struggle around the 4000 level.

Take a buy dips approach against listed Support levels today initially against the 3940 X Pivot level, then at today’s key Support at 3900-3875 XX consisting of the 5-day trend/10 and 20 DMA’s.  Upside follow through above yesterday’s 4020 high triggers the next leg up targeting the top of the 5-day channel at 4080-4100 XX Resistance up to 4150-4160 XXX which marks a 38% retracement of the 5007 to 3620 downtrend.

On the downside, failures to trade above 4020 into the pit session alerts for another round of corrective sweeps targeting the listed Supports at 3966-3940 X and 3900-3875 XX.  The turnover is expected to be triggered below 3875 initially targeting yesterday’s 3843 XXX low, then 3800 XXXX weekly lows.

Oct Cracks: The cracks pulled away from each other on Tuesday with Gas slipping 10 points on the day while the Heat rallied 65 points and leads both higher in the overnight Globex session.  Ho/Rb spread trend remains down with heat ahead of the pack.

The Heat Crack is set to Gap open strong with a Bullish outlook and buy dips strategy suggested.  Buyers can go long on dips into the 1315 X and 1290 XX Support ranges while looking for moves above 1350 X Resistance to spur advances to 1375 XX to 1400 XXX Resistance targets.

Initial struggles against 1350 X Resistance can be lightly short scalped with an objective to tackle the Gap up, using X and XX Supports to cover.  A flip below 1290 XX Support at yesterday’s high triggers a short term turnover targeting 1261-1235 XXX Support.

The Gas Crack is biased to the Bulls today and also set to Gap open higher into the pit session.  Look for dips to hold yesterday’s highs at 625-616 X Support to generate an outside day Bull pattern with objectives at 645 X, 667 XX and 700-705 XXX Resistance zones.

Light sell scalping can be done against listed Resistance areas the 1st time up, but only trade below 625-616 X Support neutralizes the Bull outlook.  A flip below 616 puts trade into corrective consolidation against lower 600-585 XX and 570-550 XXX Support levels.

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Oct Crude: Crude prices ended lower on Tuesday after a double top emerged at the 7800 level  triggering heavy sweeps to 7621 before consolidating and closing at 7680.  The market gave back 39 cents on the day with a Bearish outlook going forward on the settlement below 7700 and the 200 DMA at 7740.  A close back above the 200 DMA at 7740 is needed to negate the Bearish outlook.

Price action is sharply lower coming into the pit session open with a sell rallies bias against the 7550-7585 X and 7620-7635 XX Resistance ranges with solid testing of 7500 XX Support expected.  Trade below 7500 reinforces weakness next targeting 7450-7435 XXX Support with the potential for massive sweeps to 7400 to 7300 range.

On the upside, buyers can cautiously trade the 7500 XX and 7450-7435 XX Support ranges for scalpers rebounds using listed X’s to cover against.  A flip above 7620-7635 XX Resistance is neutral to mildly bullish for short covering rallies back to 7675-7740 XXX Resistance where any and all longs should cover and look to reverse for resumed sell offs.

Dec E-mini SP: S&P futures pegged the 3Q high set in August at 1123 and pulled back on position squaring to close nearly unchanged on the day.  The market bias has shifted to Sideways to Bearish today as we double topped at 3Q highs and followed with the emergence of a Bearish Doji reversal candle.  In addition, we’re set to open below the 12-day uptrend line at 1118 which is where overnight action peaked.

Take an initial approach to sell rallies against 1116-1119 X Resistance and again at 1123-1125 XX Resistance zones.  Our near term objective is to fill in the weekly Gap up at 1108-1104 X and XX congestion Support range.  If the Gap is filled and holds, there is a moderate chance the Bulls will step back in for a strong rebound.  However, failures to hold the 200 DMA at 1104 will set off stops targeting 1099-1096 XXX Support and potentially lower.

On the upside, buyers can take moderate positions on the 1st dips into the Gap at 1108-1104 X and XX congestion Support and look to scale out anywhere inside the 1110 to 1119 range.  Trade above 1119 will retest 1123-1125 XX key structure Resistance, but only trade above 1125 voids Bearish signals with the Bulls taking it up a notch to 1128-1130 XXX Resistance.

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